AT&T shares closed higher Tuesday as a US District judge cleared its planned merger with Time Warner Inc. with no conditions attached. The decision comes despite an attempt by the US Trump administration to block the deal. The planned merger was first announced in October 2016.
AT&T shares ended the US Tuesday trading session 0.47% higher at $34.35. Time Warner shares closed 0.02% lower at $96.22. The AT&T stock is in the red after hours, while Time Warner is a little higher.
AT&T, Time Warner Deal to go ahead
The case was referred to court as the US moved to sue the planned deal, stating it would reduce competition and increase costs for consumers in the pay TV market. However, Judge Richard Leon rejected those claims and ruled the merger was perfectly legal.
The deal was originally valued at around $85 billion and now it’s able to go ahead, will see AT&T’s wireless, satellite tv and internet business unite with Time Warner’s well-known HBO and CNN media arms, among others.
Specifically, Judge Leon ruled that the US couldn’t prove the merger would increase Time Warner’s ability to negotiate higher fees for its content. He also said that the deal would likely lead to lower prices for AT&T customers.
In addition, the district judge said it would be “unjust” for the Justice Department to put a hold on the deal.
AT&T pleased with the outcome
After 18 months waiting for a decision, AT&T was unsurprisingly pleased at the decision.
“We are pleased that, after conducting a full and fair trial on the merits, the Court has categorically rejected the government’s lawsuit to block our merger with Time Warner,” said AT&T General Counsel, David McAtee.
“We thank the Court for its thorough and timely examination of the evidence, and we compliment our colleagues at the Department of Justice on their dedicated representation of the government. We look forward to closing the merger on or before June 20 so we can begin to give consumers video entertainment that is more affordable, mobile, and innovative,” he added.